New Delhi, July 15 (IANS) Indian companies in labour‑intensive sectors such as textiles, garments, footwear, automobiles and marine products were preparing to capitalise on the India‑UK free trade agreement (FTA) that took effect on Wednesday, a new report has said.

The agreement removes or reduces tariffs on about 99 per cent of Indian exports to the UK, a change that could erase a competitive disadvantage India faced against countries such as Bangladesh and Pakistan, whose goods entered the UK duty‑free under the Developing Countries Trading Scheme, the report from BBC said.

The report cited Dipali Goenka, chief executive of Welspun Living, the Indian company that makes championship towels for Wimbledon said the deal has led to closer planning with British buyers.

She told the media house that many British brands that are their buyers came to India in recent weeks to chart a business roadmap for the next few years. “We typically did joint forward planning only for our U.S. customers, but now, with the deal, it’s happening with U.K. clients too,” she added.

“If you look at just home textiles, Pakistan’s share of UK exports is at around 55 per cent, whereas India’s is just 6-7 per cent. That’s the gap we can finally cover,” she added.

The British government has called the agreement its biggest and most economically significant bilateral trade pact since leaving the European Union.

Analysts said the key beneficiaries are likely to be sectors that previously faced UK tariffs of 4 per cent–16 per cent such as textiles, footwear, carpets, cars, seafood and certain fruits.

These sectors could see higher export orders, larger export volumes and better profit margins, proving the agreement’s success, an analyst said.

The overall impact of the deal could likely be “incremental rather than transformational”, analysts said, adding that only about 20-30 per cent of India’s eligible exports have historically used FTA preferences.

“Historically India’s utilisation of FTAs has been low because small businesses are often unaware of the new rules,” it noted.

The report cited Global Trade Research Initiative (GTRI) data that India’s exports to UK touched $13.4 billion in FY26 and over half of these exports entered the country duty-free under its most favoured nation regime.

—IANS

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